Goldman-backed biotech Septerna targets $628 million valuation in US IPO

By Niket Nishant

(Reuters) -Septerna, a nearly three year-old drug developer backed by Goldman Sachs, is aiming for a valuation of up to $628 million as it prepares to go public in a booming market for biotech listings.

The company is looking to raise up to $186 million by selling 10.9 million shares priced between $15 and $17 each, it said on Monday.

Recently listed biotech firms, including those that are yet to generate revenue, have thrived post their initial public offerings.

Investors, who had often been selective about backing new public companies in the last two years, looked past biotechs' financials and focused on other signs of maturity such as having products in clinical trials.

"Strong clinical data is helping to attract investor attention," said Joe Endoso, CEO of private investment platform Linqto.

While Septerna has not yet fetched any revenue from product sales, its lead candidate SEP-786, an oral drug to treat hypoparathyroidism, is being evaluated in an early-stage clinical trial.

Optimism spurred by the U.S. Federal Reserve's policy easing and a stock market rally could also enhance Septerna's prospects in the IPO market.

"Many life sciences firms delayed their IPOs during more challenging market conditions and are now seizing the opportunity as the market recovers," Endoso said.

California-based Septerna is developing G-protein-coupled receptor (GPCR) therapies. GPCR is a class of proteins that serve as a main conduit for chemicals to get past a cell's membrane and be taken up by a cell.

The significance of GPCR was recognized in 2012 when the Nobel Prize for chemistry was awarded to two American scientists who pioneered research in the field.

J.P. Morgan, TD Cowen, Cantor and Wells Fargo Securities are the underwriters for Septerna's IPO.

Goldman owns a 5.4% stake in the company, while healthcare-focused venture capital firm Third Rock Ventures holds 33.5%.

(Reporting by Niket Nishant and Bhanvi Satija in Bengaluru; Editing by Shilpi Majumdar)